Analyzing Pathward Financial (NASDAQ:CASH) and Orange County Bancorp (NASDAQ:OBT)

Pathward Financial (NASDAQ:CASH) and Orange County Bancorp (NASDAQ:OBT) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, analyst recommendations, dividends, institutional ownership, earnings, risk and valuation.

Earnings and Valuation

This table compares Pathward Financial and Orange County Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pathward Financial	$851.49 million	2.26	$185.87 million	$8.42	10.50
Orange County Bancorp	$127.11 million	3.73	$41.61 million	$3.32	10.66

Pathward Financial has higher revenue and earnings than Orange County Bancorp. Pathward Financial is trading at a lower price-to-earnings ratio than Orange County Bancorp, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Pathward Financial has a beta of 0.74, suggesting that its stock price is 26% less volatile than the S&P 500. Comparatively, Orange County Bancorp has a beta of 0.43, suggesting that its stock price is 57% less volatile than the S&P 500.

Profitability

This table compares Pathward Financial and Orange County Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pathward Financial	22.42%	22.35%	2.60%
Orange County Bancorp	26.32%	16.51%	1.59%

Analyst Recommendations

This is a breakdown of current ratings for Pathward Financial and Orange County Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pathward Financial	0	0	3	0	3.00
Orange County Bancorp	0	1	3	0	2.75

Pathward Financial currently has a consensus target price of $107.50, indicating a potential upside of 21.61%. Orange County Bancorp has a consensus target price of $37.00, indicating a potential upside of 4.55%. Given Pathward Financial’s stronger consensus rating and higher possible upside, equities analysts clearly believe Pathward Financial is more favorable than Orange County Bancorp.

Insider and Institutional Ownership

92.7% of Pathward Financial shares are owned by institutional investors. Comparatively, 42.5% of Orange County Bancorp shares are owned by institutional investors. 1.4% of Pathward Financial shares are owned by insiders. Comparatively, 9.3% of Orange County Bancorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Pathward Financial pays an annual dividend of $0.20 per share and has a dividend yield of 0.2%. Orange County Bancorp pays an annual dividend of $0.72 per share and has a dividend yield of 2.0%. Pathward Financial pays out 2.4% of its earnings in the form of a dividend. Orange County Bancorp pays out 21.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Summary

Pathward Financial beats Orange County Bancorp on 10 of the 15 factors compared between the two stocks.

About Pathward Financial

Pathward Financial, Inc. operates as the bank holding company for Pathward, National Association that provides various banking products and services in the United States. The company operates through three segments: Consumer, Commercial, and Corporate Services/Other. It offers demand deposit accounts, savings accounts, and money market savings accounts. The company also provides commercial finance product comprising term lending, asset-based lending, factoring, lease financing, insurance premium finance, government guaranteed lending, and other commercial finance products; consumer credit products; other consumer financing services; tax services, which includes short-term refund advance loans and short-term electronic return originator advance loans; and warehouse financing services. In addition, it issues prepaid cards; and offers payment solutions, such as acceptance, processing, and settlement of credit card and debit card payments. The company was formerly known as Meta Financial Group, Inc. and changed its name to Pathward Financial, Inc. in July 2022. Pathward Financial, Inc. was founded in 1954 and is based in Sioux Falls, South Dakota.

About Orange County Bancorp

Orange County Bancorp, Inc., through its subsidiaries, provides commercial and consumer banking products and services, and trust and wealth management services to small businesses, middle-market enterprises, local municipal governments, and individuals. It accepts various deposits, including interest-bearing and noninterest-bearing demand accounts, money market deposit accounts, savings accounts, and certificates of deposit. The company also offers commercial real estate loans, commercial and industrial loans, commercial real estate construction loans, residential real estate loans, home equity loans, and consumer loans. In addition, it provides traditional trust and administration, asset management, financial planning, and wealth management services. The company operates full-service branches and loan production office in Orange, Westchester, Rockland, and Bronx counties in New York. Orange County Bancorp, Inc. was founded in 1892 and is headquartered in Middletown, New York.